Published last week the annual accounts for Sands Heritage Limited, the operator of Margate’s Dreamland Amusement Park, show operating losses for the business year ending 31 December 2021 of £1,738,882.
But that’s just the tip of a loss making iceberg. Since being refurbished and opened to visitors in May 2015, following a generous public investment of at least £25million, the troubled amusement park has never made an operating profit.
In fact over this period, Sands Heritage has made total operating losses of £31.6 million. These losses seem set to continue unless other ways can be found to make some cash.
This is a problem which occupied the mind of Sands Heritage’s previous owner. An offshore, Cayman Island registered, tax dodging, hedge fund, called Arrowgrass. But before it could come up with a plan Arrowgrass went bust in 2019.
To raise funds to compensate its investors Arrowgrass sold off all of its assets including Dreamland. But not before the company had persuaded, some might say threatened, the council to grant planning permission for a seafront hotel on a derelict site adjacent to Dreamland, and to hand over the freeholds of the Dreamland amusement park, the Dreamland Cinema, the Dreamland Car Park and the Arlington House site for the bargain basement price of £7million.
I have now discovered that the new owner of Sands Heritage, its parent company Guernsey registered Margate Estates Limited, and the Dreamland Amusement Park , the Dreamland Cinema, the Dreamland Car Park, and the Arlington House site appears to be another offshore Jersey registered, tax dodging, company called LTO III GP Limited which is in turn owned by another Swiss based, and presumably tax-dodging, company called Multiplicity Partners AG.
Multiplicity describes itself as an investment boutique specialized in providing liquidity to holders of private market funds and distressed assets…..Multiplicity has been an active participant in the secondary market for illiquid fund interests and distressed assets since 2010. The team has successfully completed successfully more than a hundred transactions and developed a broad expertise across various illiquid, toxic and exotic assets combined with a deep understanding of sellers‘ needs.
Not that I profess to understand this melon-twisting gibberish, but I get the impression that it means that Multiplicity will squeeze every last penny of value out of distressed and toxic assets, such as a £31 million loss making amusement park in Margate, so as to enrich their wealthy investors.
But how’s it going to do that? Well it doesn’t take a genius to work it out. In fact Sands Heritage’s latest accounts make it clear. The amusement park side of the business will, in the next year or so, be phased out. The entertainment side of the business, especially live music, clubbing and perhaps also conference hosting will be scaled up, possibly with the construction of a large new all weather venue on the amusement park site and the expansion of existing indoor venues on the site such as the Hall by the Sea.
The large swathes of redundant amusement park land left over following this development, plus the adjacent Arlington House site, could then be sold off to developers by LTO III GP for expensive seafront housing developments. Perhaps someone might want to buy the scenic railway too?
The considerable tax-free profits which could be generated by such a plan will be very tempting to would be LTO III GP investors.
TDC would also be tempted too. After all, with a large seafront entertainment and conference complex in place and a new hotel all within walking distance of the railway station, what’s the point in worrying about the now closed down Winter Gardens? Perhaps it too could be sold on to a developer to convert the council’s last remaining and much loved seaside landmark into a block of flats.
And all those involved, - council bosses and elected councillors of all political colours - will no doubt congratulate themselves in facilitating the disappearance of tens, if not hundreds of £millions, in tax receipts which should have destined for funding the NHS, community care, education, social housing, and the creation of proper jobs, but have instead been diverted to lining the pockets of greedy investment fund managers and their even greedier clients
The Dreamland scandal deserves a book, or even a Netflix series, to expose the skulduggery, misconduct and likely criminality which have stained its history, prior to its new owners, LTO III GP, taking control.
I trust , LTO III GP will behave with openness and transparency in its management of Dreamland and dealings with the council, and will bear in mind the interests of Margate residents as well as its greedy, tax avoiding, investors.